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US adds restriction on foreign aid funding for COVID-19 supplies

‘We continue to remain sensitive to the needs of our neighbours and friends around the world’.

A shipment of personal protective equipment from USAID on 6 March in Kathmandu, Nepal. (US State Department)

Hundreds of millions of dollars of US international aid funding for COVID-19 may no longer be used to buy medical masks and gloves without specific approval, according to a new directive from President Donald Trump’s administration, The New Humanitarian has learned.

Using a new clause in its grant agreements, the US Agency for International Development (USAID) will require aid agencies to get prior approval to buy key items of personal protective equipment (PPE) or ventilators.

Unless extensive exemptions are granted, NGO officials said, the effectiveness of USAID’s COVID-19 funding has been thrown into question. Supplies, which protect health and other frontline workers, for other operations – including Ebola control – could also be disrupted. 

Aid agencies may be able to juggle funding from other donors to compensate for the US ban. However, the United States is the largest international donor for health, and the dominant supplier in some low-income countries, including Afghanistan and Haiti, so the “wiggle room” is limited, the officials said. 

USAID did not answer specific questions about the new rule, but said in a written statement: “Given the competing demands for some categories of medical supplies and commodities – including in the United States – the US Agency for International Development (USAID) is working with the US Government interagency and our international partners on this critical issue. We understand the urgency of the domestic requirements here in the United States while we continue to remain sensitive to the needs of our neighbours and friends around the world.”

The new USAID clause appears to block unauthorised purchases from anywhere, not just the United States. The Federal Emergency Management Agency, which coordinates the federal government’s response to disasters, already has wide-ranging powers to control domestic allocation and most exports from the United States are banned by orders put in place by the White House under the Defense Production Act.

Supplies of PPE in parts of the United States – as in other countries – have been critically low and a sensitive political issue. US authorities have even reportedly seized PPE shipments destined for export or in transit. More than 50,000 deaths from COVID-19 have been confirmed in the United States, at least a quarter of the world’s total.

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‘Political nonsense’

TNH has obtained the text of the new conditions from an NGO official told of the measures. The official insisted on anonymity to preserve professional relations with USAID. Four other people familiar with USAID grant-making confirmed they had heard the measures were being put in place.

The new conditions say, “no funds under this award may be used for the procurement of covered materials as listed below” without “prior written approval” from a USAID official handling the contract. The list includes N95 face masks and other filtering face respirators, surgical masks, surgical or exam gloves, and ventilators. The USAID “agreement officer representative” – the contract manager – can notify the grantee of changes to the items on the list, the text says.

The terms may hamper the responses that NGOs can offer using USAID money, while making little difference to PPE availability in the United States: almost all NGOs would likely purchase the items outside the US, NGO officials said.

“It’s just political nonsense,” said a global health specialist familiar with USAID procedure. “I think it’s because they’re afraid of Trump’s fan base saying, ‘we’re short of PPE, why are we giving it to foreigners?’”. The specialist said manufacturing capacity in China was expected to catch up with demand, and US shortages were the result of multiple causes.

All the aid officials contacted on this subject requested anonymity due to funding or other relationships with USAID. No agency wants to attract the ire of the Trump administration, and the political blowback on the issue could be “radioactive”, according to the specialist.

USAID has allocated an initial $99 million of funding for international aid grants in over 50 countries in response to COVID-19, of a total US government commitment of $775 million. The United States has suspended aid spending through the World Health Organisation

USAID recently airlifted 150,000 N95 masks and other PPE and supplies from its depot in Dubai to be used in the United States.

The USAID statement also said: “We are the world’s premier development agency… Our aid will improve public health education, protect healthcare facilities, and increase laboratory, disease-surveillance, and rapid-response capacity in the world’s most at risk countries.” 

Another person familiar with USAID grants said it would be like saying: “‘here’s money for education, but you have to get approval to spend it on textbooks’... It’s ass-backwards.”

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